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Published in Print: November 5, 2003, as Coca-Cola Plays Both Sides Of School Marketing Game

Coca-Cola Plays Both Sides Of School Marketing Game

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Earlier this year, the beverage giant Coca-Cola Inc. said it would stop marketing to children under age 12. Yet the Atlanta-based multinational company has stepped up its presence in the lives of students and in the education world in other ways, some industry observers say.

Coke this past summer changed its advertising policy to halt commercials before, during or after child-oriented television shows, and said it would stop running advertisements in publications aimed at the under-12 market. The company has also stopped showing children under the age of 12 in its ads and marketing materials. Instead, Coke now markets to parents and families, a company spokeswoman said.

But this fall, Coke rolled out Swerve, a new, artificially flavored milk-based drink available only in schools.

On top of that move, its largest bottler, Coca-Cola Enterprises Inc., recently signed on as an official corporate sponsor of the Chicago-based National PTA. In fact, Coke Enterprises' senior vice president of public affairs has a seat on the PTA's board, with full voting rights.

Industry observers say Coke's seemingly conflicting actions show how snack, fast-food and soft drink companies, which are under increasing pressure from anti-commercialism and child-nutrition advocates, are becoming more creative in their attempts to stay on the good sides of parents and educators, while also appealing to the lucrative Generation Y market.

"[Coke] is changing its product mix to be more profitable," said Alex Molnar, an education policy professor at Arizona State University, in Tempe, and the director of the school's education-policy-studies laboratory.

"Given the current public focus on obesity and children's health, these guys are going to have to spend a lot more time changing their core business," said Mr. Molnar, a leading critic of commercialism in schools. "Their strategy is to deflect attention from the fact that they're selling [soft drinks] that people are consuming vastly too much of."

Coke's sponsorship of the National PTA is a natural move for a company facing increasing criticism for offering its products in school vending machines all over the country, said Tom Senger, a former salesman for Coca-Cola and now an executive vice president at Elberson Senger Shuler, a Charlotte, N.C.-based advertising firm.

"Soft drink manufacturers, as well as most packaged-food companies, realize that one of the best ways to stay relevant to parents and young consumers alike is through corporate philanthropy," Mr. Senger said.

PTA Partnership

Some industry observers such as anti-commercialism activist Gary Ruskin deride the PTA for partnering with Coca-Cola Enterprises and installing one of the company's top executives on its national board. It's a serious conflict of interest for an organization whose aim is to improve children's education, health, and well-being, he contends.

"This is the corruption of a venerable institution," charged Mr. Ruskin, the executive director of Commercial Alert, a nonprofit commercial-watchdog organization based in Portland, Ore. "PTA has been a powerful advocate for the health of our nation's children. Now they're for sale. It's not the proper role of the PTA to act as an auxiliary lobbying arm for Coke Enterprises."

He added: "The leadership of the PTA should resign or be fired for abetting Coca-Cola Enterprises."

Vicki Loise, the development director for the National PTA, would not disclose how much money the organization receives from Coca-Cola Enterprises, but she said that corporate sponsorships account for 4 percent of the PTA's $12 million annual budget.

She said the organization began accepting corporate sponsorships in 1997, partnering with companies such as Disney Interactive and Sprint Inc.

Corporate sponsors of the PTA get their logos in front of the group's 6 million members in many ways, including on the PTA's Web site and in its magazine and newsletter. The companies also have opportunities to sponsor national programs, which often feature company logos on materials that are sent to the organization's 26,000 local PTAs, councils, and districts.

Ms. Loise said that the PTA is not endorsing Coca-Cola; rather, she said, Coca-Cola is endorsing the PTA through sponsoring a program to increase parent involvement in schools.

"The PTA is not an entryway for Coca-Cola into the schools," she said.

Answering to Shareholders

Besides the PTA, Coca-Cola is trying other new avenues to broaden its reach and create an image as a good corporate citizen that cares about schools and students. The company partners, for example, with the Washington-based American Council for Fitness and Nutrition, which is composed largely of other food and beverage companies and trade associations.

Coke also distributes books to elementary schools nationwide through a partnership with Coke subsidiary Minute Maid Co. and Albertson's Inc., a Boise, Idaho-based chain of grocery stores.

Such health partnerships and education projects are meant to obscure the fact that the beverage companies are selling unhealthy drinks, said marketing expert Deron Boyles, a professor in Georgia State University's college of education, in Atlanta.

"It's the highest form of hypocrisy—and it's the boldest," Mr. Boyles added. "It's savvy in terms of business rationale, but in another lexicon, it's the most egregious form of doublespeak you've ever heard in your life."

Mr. Senger, the advertising executive, sees Coke's marketing strategies as more benign. Food and beverage companies are trying to do the right thing by all consumers, but must balance pleasing parents and schools with their mission of making money, he said.

"They're getting pressure from consumer groups, so they're trying to be good citizens," he said. "But at the end of the day, they have to answer to their shareholders."

Coke spokeswoman Kari L. Bjorhus denies the company changed its marketing policy toward children because of growing concern from parents, educators, and opponents of school commercialism.

California and Arkansas recently passed legislation placing restrictions on the kinds of foods and drinks that can be sold in school vending machines. Similar legislative proposals to ban or curtail soda and candy sales in schools have been introduced in at least 19 other states, according to the National Conference of State Legislatures. ("States Target School Vending Machines to Curb Child Obesity," Oct. 1, 2003.)

Coke simply wants parents to know about the company's other beverages, such as juice and water, Ms. Bjorhus insisted.

"It's a difference from 'Hey, kids' to 'Hey, mom, here's a great juice,'" she said. "The company respects the role parents have in beverage choices for their children."

'PR Hogwash'

Swerve's introduction solely in schools is intended to give students and schools a healthier drink and another beverage choice, Ms. Bjorhus said, not to market the Coke brand to students.

Mr. Ruskin thinks otherwise.

"That's PR hogwash," he said of the company's explanation. "It's an insult to parents' intelligence around the country."

Coke's new drink is competing with similar drinks from rivals Pepsi-Cola Inc., based in Purchase, N.Y., and Pepsi subsidiary SoBe Beverage Co. Pepsi recently rolled out a flavored milk-based drink for schools called Raging Cow, while SoBe introduced a chocolate milk-based drink last year called Love Bus Brew.

An 11-ounce can of Swerve comes in chocolate, Vanana (vanilla-banana), and Blooo (blueberry). It has 130 to 150 calories, 0.5 grams of fat, 27 grams of sugar, and 115 milligrams of sodium.

In comparison, a 12-ounce serving of skim milk has 129 calories, 0.6 grams of fat, 16.5 grams of sugar, and 195 milligrams of sodium.

"We do observe a policy to keep commercialism out of the classroom," Ms. Bjorhus said. "There are no marketing programs encouraging increased beverage consumption in schools. It's a need for more variety and choice in schools."

But Mr. Boyles, the Georgia professor, said Coke's new moves in the education world were an example of how corporations have successfully enmeshed themselves in the school environment by marketing to students and offering cash-strapped schools ways to generate revenue through vending machine sales.

"You can trace corporate influence back to the 1920s, but it's become grotesquely obvious in the past 10 years," he said. "What we have now is an ingrained idea that public schools exist for private profit."

Vol. 23, Issue 10, Page 8

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